India is becoming an increasingly important
destination for global business. It is:
-
The fifth largest economy in the world by
purchasing power parity
-
A stable parliamentary democracy with an established
legal system, vibrant capital market and a mature financial system
-
Implementing a policy environment that provides
freedom of entry, investment, location and operation
-
Home to a middle class larger than the combined
population of France and Great Britain
Any foreign citizen/ company is free to establish
business operations in India. There are many options for doing business
in the country.
The simplest is to establish a representative
office in India. The second is to establish a branch office However, these
options are only for limited operations and can at best serve only short
term requirements.
Foreign companies and foreign nationals can
set up liaison or branch offices in India. Branch offices can undertake
export and import activities and can promote technical and/ or financial
collaborations between Indian and overseas companies. They can acquire
immovable property without prior permission, and remit profits earned in
India.
A company may also be incorporated in India
for business operations. The choice of establishing either a joint venture
or a fully owned subsidiary is left to the overseas investor company. Foreign
investment upto 51%, under specific conditions qualifies for automatic
approval.
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